// A sluggish start to 2015

15 May 2015

It was a sluggish first quarter for platforms. With polls predicting a hung parliament, investors held off on their investments until the outcome of the general election was clearer. Pensions also played a role in dampening flows. Not only did NS&I’s new rate-busting pensioner bonds divert the silver pound, but preparing the ground for new pension freedoms kept platforms and advisers busy throughout the first quarter.

In the first quarter of the year, platform assets under administration rose by £26.5bn (7.9%) to £370.8bn. Since March 2014 assets have expanded by £67bn, a rise of 22%. Three platforms outperformed the asset growth trend: Aviva, Zurich and Nucleus with YOY growth rates of 90%, 73% and 29% respectively.

TOP 3 PLATFORMS BY ASSETS IN Q115 (£bn)

TOP 3 PLATFORMS BY Y-O-Y ASSET GRTH (%)

Cofunds

£76.1bn

Aviva

90.2%

Fidelity

£61.1bn

Zurich

73.3%

Hargreaves Lansdown (est)*

£51.5bn

Nucleus

28.9%

TOP 3 PLATFORMS BY GROSS SALES
IN Q115 (£m)

TOP 3 PLATFORMS BY NET SALES
IN Q115 (£m)

Cofunds

£5,509m

Hargreaves Lansdown (est)*

£1,510m

Fidelity

£3,242m

Standard Life

£1,022m

Hargreaves Lansdown (est)*

£2,465m

Zurich

£745m

Gross sales for the first three months of the year were a solid £21.4bn – slightly down on Q414 (£22.1bn), but stronger than like-for-like sales in 2014 (£19.9bn). However, net sales lacked lustre at just £9.3bn, coming in below last quarter’s net sales of £12.1bn and below the £9.8bn registered in Q114.

Bella Caridade-Ferreira, CEO of Fundscape, said “The combination of politics and pensions made for a sluggish first quarter, dampened by Grexit fears on the continent. Gross flows were robust, but as indicated by net flows, there was more switching than usual and less new money overall.”

Channels**

Retail Advised

Corp/Instit

D2C/XO

Total

AUA

£220.9bn

£76.7bn

£73.1bn

£370.8bn

Gross sales

£11.5bn

£6.0bn

£3.9bn

£21.4bn

Net sales

£5.7bn

£1.6bn

£2.0bn

£9.3bn

Channels**

Retail Advised

Corp/Instit

D2C/XO

AUA

Old Mutual

Cofunds

Hargreaves L

Gross sales

Old Mutual

Cofunds

Hargreaves L

Net sales

Standard Life

Zurich

Hargreaves L

Channel sales were fairly consistent with previous trends except for the corporate/institutional channel where there was a slight slackening in flows. The retail advised channel remains the strongest by assets and its overall share of gross and net sales jumped to 53% and 61%. The Old Mutual platform was the largest retail advised platform for assets and also for gross sales. However, it was outperformed in the net sales stakes by Standard Life.

Caridade-Ferreira said, “With the elections behind us and pension freedom a fact of life, we expect an upturn in the second quarter. But these things take time to filter through and we may not see a real upswing in net flows until the third quarter of the year.”